Thursday, February 27, 2014

GLD Gold's Attempt to Double Bottom Update

GLD Gold’s attempt to double bottom (Update)

February 27, 2014

As expected from my previous post, gold has become the flight to safety asset. With the S&P500 teetering with unchanged for the year, today finally the S&P500 closed at a (new all-time high) of 1854.36 (opening on the year at 1845.86) but with a current YTD performance of just +0.46%. As noted in the previous post a move above the small blue trend line beginning with the August 137.55 high was indeed the catalyst needed to push gold higher and begin to squeeze all the short sellers out of this ETF. Once price surpassed the small blue trend line initiating a long position on a break was how I played this to get long i.e. buy this ETF (Exchange Traded Fund). I entered the market at 121.73 buying 100 shares and we saw gold prices aggressively auction higher by 4.5% in 8 days of trading. At this point in the game gold prices are testing the (Early Confirmation) and attempting to cross the dark blue multimonth trend line going back to the October 4th of 2012 high of 174.07 as mentioned in my previous post. This multimonth trend line discussed still remains as the (Early Confirmation) signal that the 114.68 gold lows are attempting to hold and that gold’s trend is apt to reverse with a price close above 137.55. At this point in the game we are seeing an immediate reaction/consolidation as anticipated at the multimonth (1st Confirmation) trend line. Currently I’m up +5.32% on this position as the S&P500 is up a lousy +0.46%, so to protect my position (Profits) I’m going to trail up a stop limit order to protect myself if a correction try’s to occur. By doing so I eliminate 100% of my risk in result creating a risk free trade. As this this trade pans out over the next several weeks/months, I will continue to monitor the S&P500 and adjust my gold stop accordingly as I expect gold to push up, test and ultimately close above the 137.55 (2nd Confirmation) high confirming that the 114.68 lows are in and my 160.00 measured move (target) is active.     

Wednesday, February 19, 2014